Financial Mathematics is the branch of applied mathematics concerned with the financial markets. It overlaps heavily with the fields of financial engineering and computational finance. Arguably, all three terms are synonymous. The subject naturally has a close relationship with the discipline of financial economics, but financial mathematics is narrower in scope and more abstract. A central difference is that while a financial economist might study the structural reasons why a company may have a certain share price, a mathematician or financial engineer may take the share price as a given, and attempt to use stochastic calculus to obtain the fair value of derivatives of the stock.
Financial Mathematics is a flourishing area of modern science. Its numerous applications have become vital to the day to day functioning of the world’s financial institutions. As a consequence, a solid command of the principles and techniques of quantitative finance is essential for a responsible approach to the trading, asset management, and risk control of complicated financial positions.
Many countries’ financial sectors have enjoyed unparalleled expansion over the past decade and opportunities have emerged for careers in numerous areas of the financial system. With the integration of financial markets in Europe and elsewhere new job opportunities are appearing all the time.
Within the manufacturing and service sectors of economies, financial analysis is becoming increasingly technical and the range of alternative financial instruments available to firms is expanding rapidly. There is increasing demand for employees with an understanding of the new tools and the ability to apply them.
